Seitel Holdings 2008 Restricted Stock Unit Plan











Exhibit 10.1

 




 

 


SEITEL HOLDINGS, INC.


2008 RESTRICTED STOCK AND RESTRICTED STOCK UNIT PLAN

EFFECTIVE APRIL 8, 2008

 




1.                 
Purpose of Plan.  This 2008 Restricted Stock and Restricted Stock
Unit Plan (the "Plan") of Seitel Holdings, Inc., a Delaware corporation
(the "Company"), is designed to provide incentives to such present and
future Employees of the Company or its Subsidiaries, as may be selected in the
sole discretion of the Committee, through the grant of Restricted Stock and
Restricted Stock Unit Awards by the Company to Participants.  This Plan is
intended to advance the best interests of the Company by providing those
persons who have a substantial responsibility for its management and growth
with additional incentives by allowing them to acquire an ownership interest in
the Company and thereby encouraging them to contribute to the success of the
Company and to continue to provide services to or remain employed by the
Company or a Subsidiary (as the case may be).  The availability and offering of
Restricted Stock and Restricted Stock Units under the Plan also increases the
Company's ability to attract and retain individuals of exceptional managerial
talent upon whom, in large measure, the sustained progress, growth and
profitability of the Company depends.  All Awards granted under the Plan are
intended to qualify for an exemption (the "Exemption") from the
registration requirements under the Securities Act, pursuant to Rule 701 of the
Securities Act.  In the event that any provision of the Plan would cause any Award
granted under the Plan to not qualify for the Exemption, the Plan shall be
deemed automatically amended to the extent necessary to cause all Awards
granted under the Plan to qualify for the Exemption.

2.                  
Definitions.  Certain terms used in this Plan have the meanings
set forth below:


"Approved Sale" shall have the meaning
ascribed to such term in the Securities Holders Agreement.


"Award" means Restricted Stock or
Restricted Stock Units granted under the terms of the Plan.    


"Award Agreement" means the agreement
between the Company and a Participant pursuant to which an Award is granted and
which specifies the terms and conditions of that Award, including the vesting
requirements applicable to that Award.  Each Award granted under the Plan shall
be evidenced by Award Agreement.


"Award Shares" means shares of
Restricted Stock, shares of Common Stock and Units acquired pursuant to an
Award.  


"Board" means the Company's board of
directors.


"Cause" shall have the meaning ascribed
to such term in the applicable Employment Agreement, or if none, the Award
Agreement.


"Common Stock" means the Company's
Common Stock, par value $0.001 per share.


"Code" means the Internal Revenue Code
of 1986, as amended, and the regulations promulgated thereunder, as the same may
be amended from time to time.


"Committee" means the Board or a
committee of the Board designated to administer the Plan.  Upon the
consummation of a Public Offering the Committee shall be composed of two or
more directors appointed by the Board, each of whom shall be a "non-employee
director" as defined in Rule 16b-3 under the Securities Exchange Act of 1934,
as amended (the "1934 Act"), and an "outside director" as defined in
Section 162(m) of the Code. 


"Disability" means, as determined by the Committee in its sole
discretion, that a Participant:


        (a)        
is unable to engage
in any substantial gainful activity by reason of any medically determinable
physical or mental impairment which can be expected to result in death or can
be expected to last for a continuous period of not less than 12 months, or 


        (b)        is, by
reason of any medically determinable physical or mental impairment which can be
expected to result in death or can be expected to last for a continuous period
of not less than 12 months, receiving income replacement benefits for a period
of not less than 3 months under an accident and health plan covering Employees.


"Employee" means
a senior executive employee of the Company and/or any of its Subsidiaries. 


"Employment Agreement" means the
employment agreement by and between a Participant and the Company and/or any of
its Subsidiaries (if any for such Participant), as in effect from time to time.


"Investor" means
ValueAct Capital Master Fund, L.P., a British Virgin Islands limited
partnership, or any Successor thereto.


"Participant" means an Employee who is
granted an Award hereunder. 


"Person" means an individual, a
partnership, a corporation, a limited liability company, an association, a
joint share company, a trust, a joint venture, an unincorporated organization
and a governmental entity or any department, agency or political subdivision
thereof.


"Public Offering" shall have the meaning
ascribed to such term in the Securities Holders Agreement.


"Restricted Stock" means Common Stock
awarded by the Committee under Section 5 hereof. 


"Restricted Stock Unit" or "Unit" means
a right, granted to a Participant under Section 6 hereof, to receive the value
of Common Stock at the end of a specified deferral period. 


"Securities Act" means the Securities
Act of 1933, as amended, and any successor statute thereto.


"Securities Holders Agreement" means the
Securities Holders Agreement by and among Seitel Holdings, LLC, Valueact
Capital Master Fund, L.P., and the Management Investors identified therein,
dated January 8, 2007, as amended from time to time.


"Subsidiary" means any corporation,
partnership, joint venture or other business entity of which 50% or more of the
outstanding voting power is owned, directly or indirectly, by the Company.


"Successor" means: (i) a Permitted
Transferee, (ii) the legal representative of a Participant or his or her estate
(in the case of a deceased Participant) or (iii) the Person or Persons who
shall acquire an Award or Award Shares by bequest or inheritance or other
transfer by reason of the death of the Participant.


Capitalized terms used in this Plan and not
defined herein shall have the meanings ascribed thereto in the Securities
Holders Agreement.


3.                  
Administration of the Plan.  


(i)                 
The Plan shall be administered by the Committee, which shall have full
power to interpret and administer the Plan and full authority to act in
selecting the Employees to whom Awards will be granted, in executing Award Agreements
with Participants under the Plan, in determining whether, and to what extent, Awards
may be transferable by a Participant in accordance with the Securities Holders
Agreement, in determining the number of shares of Restricted Stock or the
number of Units to be granted to each such Employee under an Award, and in
determining the terms and conditions of Awards granted under the Plan. 


(ii)                
Subject to the other terms of the Plan, the Committee shall, in its
discretion as reflected by the terms of the applicable Award Agreement:  (i)
determine the number of shares of Restricted Stock or the number of Units subject
to each Award; (ii) determine the time or times when and the manner and
condition in which each Award shall vest and/or be settled, as applicable; and
(iii) determine or impose other conditions as it may deem appropriate. 


(iii)               
The Committee may condition the vesting and/or settlement of an Award
upon: (i) the Employee's continued service over a period of time with the
Company or its Subsidiaries, (ii) the achievement by the Participant of certain
performance goals, or (iii) any combination of the above conditions, as
specified in the applicable Award Agreement.  If the specified conditions are
not attained, the Participant shall forfeit the portion of the Award with
respect to those conditions that are not attained.  


(iv)               
The Committee shall have the power to adopt regulations for carrying out
the Plan and to make changes to such regulations as it shall, from time to
time, deem advisable.  Any interpretation by the Committee of the terms and
provisions of the Plan and the administration thereof, and all actions taken by
the Committee, shall be final and binding on Participants and Successors, if
applicable.


4.                  
Shares of Common Stock Subject to the Plan.  


(i)                 
Subject to adjustment as provided in Section 8 hereof, the maximum
number of shares that may be issued under the Plan shall not exceed 25,000
shares.


(ii)                
Any shares issued by the Company through the assumption or substitution
of outstanding grants from an acquired company shall not reduce the shares
available for Awards under the Plan.  Any shares issued hereunder may consist,
in whole or in part, of authorized and unissued shares or treasury shares.  If
any Award (or portion thereof) granted hereunder is forfeited or such Award (or
portion thereof) otherwise terminates, the shares subject to such Award, to the
extent of any such forfeiture or termination, shall again be available for Awards
under the Plan.


5.                  
Restricted Stock. The Committee is authorized to grant Restricted
Stock to Participants on the following terms and conditions: 


(i)                  Grant and Restrictions.
Restricted Stock shall be subject to such restrictions on transferability, risk
of forfeiture and other restrictions, if any, as set forth in an Award
Agreement and the Securities Holders Agreement.  Except as otherwise provided
herein or in an Award Agreement, a Participant granted Restricted Stock shall
have all of the rights of a shareholder with respect to such Restricted Stock,
including the right to vote and the right to receive dividends, subject in each
case to the provisions of the Securities Holders Agreement.  


(ii)                 Forfeiture.
Except as otherwise provided in the applicable Award Agreement, the Securities
Holders Agreement or determined by the Committee in its sole discretion, all of
a Participant's unvested shares of Restricted Stock shall be forfeited upon the
Termination Date (as defined in the Securities Holders Agreement) of such
Participant's employment with the Company and all Subsidiaries. 




(iii)                 Certificates
for Stock. Restricted Stock granted under the Plan may be evidenced in such
manner as the Committee shall determine. If certificates representing
Restricted Stock are registered in the name of the Participant, the Committee
may require that such certificates bear an appropriate legend referring to the
terms, conditions and restrictions applicable to such Restricted Stock, that
the Company retain physical possession of the certificates, and that the
Participant deliver a stock power to the Company, endorsed in blank, relating
to the Restricted Stock. 




(iv)                Dividends. 
All dividends to which a Participant is entitled to receive by reason of his or
her ownership of unvested shares of Restricted Stock shall be paid in shares of
Restricted Stock (as determined by the Committee in its sole discretion) which
shall be subject to the same terms and conditions as the Restricted Stock on
which such dividends were granted.  


6.                 
Restricted Stock Units. The Committee is authorized to grant
Units to Participants, which are rights to receive Common Stock, cash, or any
combination thereof at the end of a specified deferral period (as set forth in
an Award Agreement), subject to the following terms and conditions: 


(i)                 Nature of Units. 
Units are solely a device for the measurement and determination of the amounts
to be paid to a Participant under the Plan.  Each Participant's right in Units
is limited to the right to receive payment, if any, as may be provided in an
Award Agreement.  Units do not constitute Common Stock and shall not be treated
as (or as giving rise to) property or as a trust fund of any kind; provided,
however, that the Company may establish a mere bookkeeping reserve to
meet its obligations hereunder or a trust or other funding vehicle that would
not cause the Plan to be deemed to be funded for tax purposes or for purposes
of Title I of the Employee Retirement Income Security Act of 1974, as amended. 
The right of any holder of Units to receive payments by virtue of participation
in the Plan shall be no greater than the right of any unsecured general
creditor of the Company.  Nothing contained in the Plan shall be construed to
give any Participant any rights with respect to Common Stock or any ownership
interest in the Company by reason of being granted an Award of Units.  No
provision of the Plan shall be interpreted to confer any voting, dividend,
derivative or other similar rights with respect to any Units, except as
provided in Section 6(iv).  


(ii)                
Award and Restrictions.
Payment or delivery of an Award of Units shall occur pursuant to the terms of
the applicable Award Agreement.  Units shall be satisfied by delivery of Common
Stock, unless otherwise determined by the Committee. 


(iii)                 Forfeiture. Except
as otherwise provided in the applicable Award Agreement, the Securities Holders
Agreement or determined by the Committee in its sole discretion, all of a
Participant's unvested Units shall be forfeited upon the Termination Date (as
defined in the Securities Holders Agreement) of such Participant's employment
with the Company and all Subsidiaries.   


(iv)                Dividends.  All dividends to which a Participant is entitled
to receive by reason of his or her ownership of Units shall be paid in Units
(as determined by the Committee in its sole discretion) which shall be subject
to the same terms and conditions as the Units on which such dividends were
granted. 




7.                  
Listing, Registration and Compliance with Laws and Regulations. 
Each Award shall be subject to the requirement that if at any time the
Committee shall determine, in its discretion, that the listing, registration or
qualification of the shares subject to the Award upon any securities exchange
or under any federal, state or foreign securities or other law or regulation,
or the consent or approval of any governmental regulatory body, is necessary or
desirable as a condition to or in connection with the granting of such Award or
the issue or purchase of shares thereunder, no such Award may be issued or paid
in shares of Common Stock in whole or in part unless such listing,
registration, qualification, consent or approval (a "Required Listing")
shall have been effected or obtained.  The Participant of each such Award will
supply the Company with such certificates, representations and information as
the Company shall request which are reasonably necessary or desirable in order
for the Company to obtain such Required Listing or otherwise comply with any
other applicable federal, state, local or foreign law, and shall otherwise
cooperate with the Company in obtaining such Required Listing or in complying
with such law(s).  The Company agrees to use commercially reasonable efforts to
effect or obtain any Required Listing.  


8.                 
Adjustment for Change in Common Stock.  In the event of a
reorganization, recapitalization, stock split, stock dividend, combination of
shares, merger, consolidation or other change in Common Stock (or Common Stock
generally), the Committee shall make appropriate changes in the number and type
of shares authorized by this Plan and the number and type of shares covered by
outstanding Awards.


9.                 
Taxes.  The Company shall be entitled, if necessary or desirable,
to withhold (or secure payment from the Participant in lieu of withholding) the
amount of any withholding or other tax due from the Company with respect to any
Award, including the vesting or settlement thereof, issued under this Plan, and
the Company may defer granting such Award, or its vesting or settlement, unless
indemnified to the Board's satisfaction.  In any event, each Participant shall
be required to indemnify the Company and hold it harmless for any and all
withholding and similar tax obligations arising in connection with an Award.


10.               
Termination and Amendment.  The Committee at any time may suspend
or terminate this Plan and make such additions or amendments as it deems
advisable under this Plan (except that it may not extend the term of this
Plan); provided that, subject to the other provisions hereof, the
Committee may not change any of the terms of an Award Agreement in a manner
which would have a material adverse effect on the Participant without such
Participant's consent.  Notwithstanding the foregoing, any amendment to the Securities
Holders Agreement that affects a provision contained herein shall be deemed to
be an amendment to the Plan.  To the extent any such amendment to the Securities
Holders Agreement affects the terms of an Award Agreement, the Participant and
any Successor shall be deemed to have consented to that amendment.  This Plan
shall terminate on the 10th anniversary of the effective date.  


11.               Participant Acknowledgments.  In connection with the grant of any
Award and/or the issuance of any Award Shares, each Participant acknowledges
and agrees, that as a condition to any such grant or issuance:


(i)                 
The Company will have no duty or obligation to disclose to any
Participant, and no Participant will have any right to be advised of, any
material information regarding the Company or its Subsidiaries at any time
prior to, upon or in connection with, the Company's exercise of any repurchase
rights in the Securities Holders Agreement with respect to any Award Shares.



(ii)                
Such Participant will have consulted, or will have had an opportunity to
consult with, independent legal counsel regarding his or her rights and
obligations under this Plan and any written agreement evidencing any grant of
any Award or the issuance of any Award Shares and he or she fully understands
the terms and conditions contained herein and therein.


(iii)                
Each Participant shall acknowledge the restrictive covenants contained
in his or her Employment Agreement, if any, and/or the Securities Holders
Agreement and shall execute and deliver to the Company a joinder to the
Securities Holders Agreement reasonably satisfactory in form and substance to
the Company.


12.               
Application of Securities Holders Agreement; Restrictions on Transfer.


(i)                 
Each Participant and his or her Permitted Transferees shall be required
to join the Securities Holders Agreement and agree to be subject to its terms
upon receipt of an Award granted hereunder.


(ii)                
Except as provided below, Awards may not be pledged, assigned or
transferred for any reason during the Participant's lifetime, and any attempt
to do so shall be void and the relevant Award shall be forfeited.  The
Committee may grant Awards that are transferable by the Participant during his
or her lifetime, but such Awards shall be transferable only to the extent
specifically provided in an Award Agreement and subject to the Securities
Holders Agreement.  The transferee of the Participant shall, in all cases, be
subject to the Plan, the Securities Holders Agreement and the provisions of the
applicable Award Agreement.


(iii)                
An Employee, or if applicable a Successor, who receives an Award shall be
bound by the Securities Holders Agreement to the same extent as would a "Management
Investor," as that term is defined in the Securities Holders Agreement, and each
Award Share shall be an "Incentive Security" within the meaning of the Securities
Holders Agreement.  Accordingly, any Award and all Award Shares shall be held,
transferred, sold or otherwise disposed of only in accordance with the Securities
Holders Agreement. Without limiting the generality of the foregoing, each Participant
and any Successor shall comply with the provisions set forth in the Securities
Holders Agreement with regard to an Approved Sale, as well as be bound by any
transfer restrictions, restrictive covenants and other obligations delineated
in the Securities Holders Agreement.  Any rights of a "Management Investor"
under the Securities Holders Agreement will be available to a Participant or
Successor only in respect of any portion of an Award which is then vested.  In
addition, and notwithstanding anything to the contrary herein, all Award Shares
shall, regardless of whether such Award Shares are subject to restrictions or
conditions or whether such Award Shares are vested under the applicable terms
of the Plan or Award Agreement, be subject to the Repurchase Option of the
Company upon any termination of the Employee's employment with the Company and
all Subsidiaries in accordance with the terms of the Securities Holders
Agreement.   


13.                
Approved Sale, Public Offering or Other Corporate Transaction


(i)                 
Notwithstanding any provision in this Plan to the contrary and unless
otherwise provided in the applicable Award Agreement, in the event of (a) an
Approved Sale, (b) a Public Offering, or (c) a Change in Control (as defined in
the applicable Award Agreement or as otherwise determined by the Committee in
its sole discretion) (each, a "Transaction"), the Committee may, in its sole
discretion:


         (a)        accelerate the vesting of all or a portion of an Award,



         (b)        settle any vested Units for per-share consideration received in the
Transaction or the equivalent value thereof, as determined by the Committee in
its sole discretion, or


         (c)        require the successor corporation, following a Transaction if the
Company does not survive such Transaction, to assume all outstanding Awards or
to substitute such Awards with awards of such successor corporation on terms
and conditions necessary to preserve the rights of Participants under such
Awards.


14.               
Severability.  Whenever possible, each provision of this Plan
will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Plan is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Plan will be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision had never been contained herein.


15.               
Remedies.  Each of the Company and any Participant will be
entitled to enforce its rights under this Plan specifically, to recover damages
and costs (including reasonable attorneys' fees) caused by any breach of any
provision of this Plan and to exercise all other rights existing in its favor. 
Each Participant and the Company acknowledges and agrees that money damages may
not be an adequate remedy for any breach of the provisions of this Plan and
that any party may in its sole discretion apply to any court of law or equity
of competent jurisdiction (without posting any bond or deposit) for specific
performance and/or other injunctive relief in order to enforce or prevent any
violations of the provisions of this Plan.


16.             
  
Business Days.  If any time period for giving notice or taking
action hereunder expires on a day which is a Saturday, Sunday or holiday in the
state in which the Company's chief executive office is located, the time period
shall be automatically extended to the business day immediately following such
Saturday, Sunday or holiday.


17.               
Governing Law.  All issues concerning this Plan will be governed
by and construed in accordance with the laws of the State of Delaware, without
giving effect to any choice of law or conflict of law provision or rule
(whether of the State of Delaware or any other jurisdiction) that would cause
the application of the law of any jurisdiction other than the State of
Delaware.  Each of the Company and each Participant waives the necessity
for personal service of any and all process upon it and consents that all such
service of process may be made by registered or certified mail (return receipt
requested) or an overnight courier with delivery confirmation, in each case
directed to such party in accordance with the notice requirements set forth in
this Plan, and service so made will be deemed to be completed on the date of
actual receipt.  Each of the Company and each Participant consents to service
of process as aforesaid.  Nothing in this Plan will prohibit personal service
in lieu of the service by certified or registered mail or an overnight courier
with delivery confirmation contemplated herein.


18.               
Notices.  Any notice required or permitted under this Plan or any
agreement executed and delivered in connection with this Plan shall be in
writing and shall be either delivered by reputable overnight courier with
delivery confirmation, personally delivered, or certified or registered mail,
return receipt requested, to any Participant at the address indicated in the Company's
records for such Participant, and to the Company at the address below
indicated:


   Notices to the Company:

 




   Seitel Holdings, Inc.


   c/o ValueAct Capital Master
Fund, L.P.


   435 Pacific Avenue, 4th
Floor


   San Francisco, CA  94133


   Attention:          Allison
Bennington, General Counsel




or such other address or to the attention of such other
person as the recipient party shall have specified by prior written notice to
the sending party.  Any notice under this Plan shall be deemed to have been
given when so delivered or mailed.